How to Start a Business Between Friends
Work With Friends
Even if you decide to work with one or more of your close friends, it's still a business. So remember that you're still going to treat the operation as such.
This can be a hard thing to do, as friends like to joke around, play, and goof off together, but since you've all put your hard earned money and time into this endeavor, it's best to leave play at home or at the ball game.
The one thing that you want to do is try to remember that work is work and play is play. You don't want to (1) mess up your hard earned work to have a failing business, and (2) you don't want to ruin your friendship.
Play VS Work
Starting a Business
When you and a few of your friends have decided to start a business together, you want to remember (like I've already said) keep play at the club and work at work. This will create the most professional atmosphere, and it will help separate friendship and business.
When starting a small business, you want to make sure that you have everything planned out from the start.
You and each of your friends that you want to start a business with need to sit down and create the idea, business name, and business action plan. You need to make sure that you all agree on all the fine points because otherwise, you may come into several disagreements once you've actually started the business.
Decide if you will give yourselves and other friends a discount of your product or services. If so, you all need to come to the agreement as to how much the discount will be. Remember, this is still a business, so you still want to make a net profit in the outcome.
Create a semi- formal contract between everyone. You may want to make it legal by coming up with your business plan and going to a business lawyer to draw up a legal, formal contract for everyone to sign.
Make sure that the contract includes every pinprick and detail, from charging customers to charging friends.
- How you will divide the profits and losses.
- How much you each will put forth, money and time- wise.
- What happens if one of the partners wants out of the business.
- How you will go about selling shares of the business.
You want to cover everything in the contract, so that you leave no loose end untied.
Make sure that each partner has a signed copy of the contract, and if you need to make updates to the contract. If you go the legal route, always have a lawyer draw up a new contract to accommodate for the updates to your business plan.
Remember that just because you are keeping your social life out of the business, you don't have to sacrifice all forms of humor.
You can still throw a good office prank every now and then. Just make sure not to go overboard. A little post- it war or tinfoil gag is always fun and exciting to spruce up the anxiety building over a big client meeting.
If you're running this small partnership out of your own home or a friend's, you can still play a few harmless jokes. Just remember not to joke about clients or the business. You don't want to scare your friend about losing a big customer or going out of business.
He may come after you with a vengeance when he finds out it's not true.